Key takeaways:
Sales of lab-grown diamonds could eclipse mined diamonds by 2030, says Diamond Foundry’s Martin Roscheisen.
They are attracting an ethically conscious consumer at a lower price point.
Their popularity poses a challenge for traditional fine jewellers. De Beers Group charges $800 per carat for a one-carat synthetic diamond, compared to $8,000 for a mined version. Still, it's an opportunity to produce fashion jewellery aimed at millennials.
A diamond is just a lump of coal that did well under pressure. But exactly what kind of pressure, and in what conditions, lie at the centre of a debate that has divided and disrupted the sparkling world of fine jewellery. Technology has evolved so rapidly over the past five years, the industry has witnessed a boom in lab-grown diamonds – gemstones that are chemically and aesthetically identical to those found at the bottom of the Earth, yet can be produced in a matter of months. And with a younger, more ethically conscious generation coming of diamond-buying age, many argue that a lab is the best way of providing the world with its favourite gemstone.
For the big jewellery houses, the shift towards synthetic has proved more problematic. Take historic brand De Beers, which monopolised the diamond market for well over a century and is still the world’s largest miner, with exclusive access to Botswana’s entire supply chain. Having coined the phrase “a diamond is forever”, for years De Beers expressed its reluctance to embrace synthetic diamonds, preferring to focus on the image of mined diamonds as rare, eternal and the only option for engagement rings. But this May the house performed a U-turn with Lightbox, a new range of lab-grown diamonds produced under the De Beers Group umbrella. With a $94 million facility in Oregon, Lightbox aims to produce 500,000 synthetic carats per year by 2020.
Lightbox’s approach is telling. Targeted at a younger clientele, its campaigns will be lighter in tone and geared towards fashion trends, rather than playing on the emotional gravitas of engagement rings. Prices are $800 per carat; by comparison, a one-carat mined diamond will usually sell for about $8,000.
“It’s light and fun and decorative,” says chief marketing officer Sally Morrison. “We tell it like it is and we are pursuing completely linear pricing. With natural diamonds, pricing follows a curve based on rarity, which just doesn’t make sense for lab-grown products.”
Morrison says Lightbox’s biggest competitors are costume-jewellery behemoths, such as Swarovski. De Beers is effectively betting on splitting the market – with luxury, complex, mined-gem engagement rings at the top, and lab-made fashion jewellery, mainly solitaires, aimed at millennials, at the bottom.
For jewellers old and new, lab-grown diamonds remain uncharted territory. On the one hand, it presents a new medium that is chemically the same as mined diamonds, available ethically and at a much more accessible price point. On the other, it could dilute the aura of luxury and rarity that so many jewellers trade on.
For Stephen Webster, one of London’s leading independent jewellers, it is a point of interest – but only to a certain degree. “The one thing that everyone would agree on is that you don’t want to see confusion,” he says. Whereas he uses mined stones for his namesake label, the jeweller has partnered with Atelier Swarovski on a line of fair-trade pieces featuring 14-carat recycled gold, rose quartz and lab-grown pavé diamonds – or “created” diamonds, as Swarovski prefers to call them.
“When I was asked by Swarovski to work on this project, I knew I was working on something completely separate to what I do,” says Webster. “The stones that we’re using in this collection are intentionally small stones, to add a bit of glitz to a piece. A lot of fashion-forward jewellery is about design, [and] not so much [about] high-value individual stones.”
For Webster, working with synthetic diamonds provides an opportunity to speak to a younger audience at a more accessible level. Prices start at £1,290 and go up to £7,490. He agrees that synthetic stones could act as a more democratic platform for fine jewellery, just as diffusion lines or high-street collaborations can for high-end fashion designers. “There’s a call for more democracy in fashion and jewellery,” says Webster. “I’m not bursting any illusion about the rarity of what comes out of the ground, which is to do with colour and size and uniqueness. As beautiful as they are, a lab-grown diamond is coming in as an alternative for people to make up their own mind about.”
“It will be totally disruptive,” asserts Nadja Swarovski, matriarch of the legendary crystal manufacturer, which began cutting gemstones in 1965. “There’s a belief that diamonds are rare and precious, and I think it’s also going to be a generational thing. My mother would never buy a created diamond, but my daughters would only buy a created diamond.” For Swarovski, which for years has been associated with crystals, this marks an unprecedented dive into the world of diamonds – and Nadja Swarovski is keen to add that the Austrian company will also be looking into using natural diamonds, as long as they are ethically sourced. “It’s exciting for us to go into the fine jewellery market,” she adds. “I’m not sure how fine jewellers are not embracing created diamonds.”
Within the jewellery community – and indeed among luxury consumers – synthetic diamonds just don’t have the same ring (for want of a better word) as mined stones. Currently, engagement rings account for almost a third of global diamond jewellery sales, which makes them a substantial contributor to the revenues of jewellery houses. It remains divisive whether consumers could be drawn to synthetic diamonds for such a highly sentimental piece of jewellery. De Beers is adamant that they won’t be – yet, in a survey by market research company MVI, the percentage of consumers willing to buy an engagement ring with a lab-grown diamond is steadily increasing, rising from 55 per cent in 2016 to almost 70 per cent in 2018.
“With how quickly this industry is growing, it could eclipse mined diamonds by 2030,” says Diamond Foundry’s Martin Roscheisen, who adds that the company’s production and sales have almost doubled each quarter and it is currently producing more than 100,000 carats per year. If those figures are anything to go by, it may not be long before the esteemed names on Place Vendôme take note.
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